Pablo Management has five part-time employees, each of whom earns $250 per day. They are normally paid on Fridays for work completed Monday through Friday of the same week. They were paid in full on Friday, December 28. The next week, the five employees worked only four days because New Year's Day was an unpaid holiday. Prepare the adjusting entry that would be recorded on Monday, December 31 and Friday, January 4.

Question

Zane Webster

Business

22 May, 05:07

Pablo Management has five part-time employees, each of whom earns $250 per day. They are normally paid on Fridays for work completed Monday through Friday of the same week. They were paid in full on Friday, December 28. The next week, the five employees worked only four days because New Year's Day was an unpaid holiday. Prepare the adjusting entry that would be recorded on Monday, December 31 and Friday, January 4.

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Talan Mckee · Answer 1

wages expense 1,250

wages payable 1,250

- - to record accrued wages - --

wages expense 1,250

wages payable 3,750

cash 5,000

--to record payment of wages - --

Explanation:

5 employee x 250 each = 1,250 per day

on monday december 31th the companny will record the accrued wages

it will recognize the expense for the period and declare the payable.

on January fourth we will pay for four days:

1,250 x 4 = 5,000

one days was already accrued: 1,250

so the expense for this week will be: 3,750